The Securities and Exchange Commission (SEC) has unveiled plans to create a new e-dividend portal that would help simplify the process of mandating accounts in the capital market.
Besides, the commission also explained that processes put in place to entrench trust in the Collective Investment Scheme (CIS) has increased the fund under management from N1 trillion in 2020 to N2 trillion in 2023.
Indeed, the figure rose to N190 billion in August 2023 from N180 billion as at December 2021 and N170 billion in 2020. The apex capital market regulator has put several measures in place to eradicate the difficulties encountered by retail investors in claiming their dividends through their savings accounts, especially the introduction of the e-Dividend Management Mandate System (e-DMMS).
The initiative, which was rolled out in 2015, is an electronic dividend payment platform that enables an investor’s account to be credited after 24 hours the dividend is paid.
Also, SEC had recently inaugurated the e-dividend champions for banks and registrars at its Lagos Zonal office. The champions would have the responsibility of forwarding all shareholders’ complaints on registration to the Nigerian Interbank Settlement System (NIBSS) to give clarifications on the issues within three days.
Rising unclaimed dividend figures have been linked to a lack of awareness, forgotten investments, multiple subscriptions, and inaccurate and outdated information/identity management necessitating the commission to deploy measures to check the trend.
At the SEC Journalists’ training held in Lagos, yesterday, the Director-General of the Commission, Lamido Yuguda, said SEC was poised to tackle the perennial problems of unclaimed dividends.
According to him, the portal, which is expected to become operational by the end of the month, would enhance efficiency and ultimately lead to a significant fall in unclaimed dividends.
He said: “In furtherance of its efforts to ensure that new dividends do not become unclaimed, the commission is presently supporting work on an identity management system that would ensure that investors and market participants are properly identified so as to forestall the problems that led to accumulation of unclaimed dividends.”
Yuguda noted that efforts by the commission to manage risk and entrench trust in CIS by ensuring that all CIS funds be held in custody has helped the growth of these funds from about N1.1 trillion at the beginning of 2020 to about N2.1 trillion at the end of October 2023.
He urged investors, especially those at the retail end, to approach the market through these CIS funds, as they provide investors with the opportunity to have their investments managed by knowledgeable investment professionals.
According to Yuguda, the commission embarked on an amendment of the Investments and Securities Act (2007) with the Investments and Securities Bill (2023) currently at the National Assembly.
He appealed for speedy passage of the Bill to enable the commission to position the market better for the economic growth, as well as strengthen its ability to carry out its mandate with enabling laws that support its activities.